At level 2, my character still does 40 damage, despite having higher power.
At level 7, my character still does 40 damage, despite having higher power.

When I was downleveled from level 7 to level 6, my damage dropped to 38, which is
below the damage I did at level 1 without being downleveled.

When I was downleveled from level 7 to level 2, my damage dropped to something like
6 points per swing. Where as at first I did 40 damage at level 1. You can’t kill stuff when
you only do 6 damage per swing.

So there seems to be two bugs:

1) Damage does not increase when leveling up, despite having higher power each level.
2) When you get downleveled, the damage drops to way below to what it should be at
that level, way, way waaay below. Doing 6 damage per swing while downleveled to level
2 is not fun.